Corporate tenants seeking comfortable and less expensive non-central office locations have boosted the number of lease transactions outside Warsaw's central business district (CBD), real estate experts said.
About 68% of all class A office leases in the Warsaw metropolitan area in 2001 were for spaces in non-central locations, according to a recent report by Colliers International, the global real estate services firm.
Likewise, a report released by real estate consultancy Cushman & Wakefield Healey & Baker (CWHB) in June stated that most leasing deals in Warsaw during the first two quarters of 2002 were for non-central office locations.
Comfort, accessibility and price are the most important factors for firms that choose to rent office space in non-central locations, real estate experts said. Among the main amenities that attract companies to suburban locations are parking facilities and access roads.
Tenants are not only drawn to non-central locations by less expensive parking facilities, but also by more attractive rents.
"There is a greater availability of office buildings (in non-central locations), which offer a similar standard of services to the ones in the center, and we are able to negotiate comfortable rents for our clients," said Grażyna Melibruda of the Warsaw office of King Sturge, a property consultancy.
At the moment, average rents in the CBD start at $25-$26 per square meter, while the highest rent levels in non-central locations are about $19 per square meter, according to Jarosław Zagórski, an associate partner at CWHB.
"Office space rent in locations such as Wiśniowy Business Park in Warsaw's Mokotów district can cost $19 per square meter, but rents in other locations outside the city center can be as low as $14 per square meter," he said.
As a result, many companies, including LOT Polish Airlines and media giant Agora, have decided to build their headquarters in non-central locations.
"The general trend is that many firms do not want to be located in the center anymore, apart from financial firms, banks or consultancies, which are always located in the centers," said Maciej Gołźbiewski, a senior property negotiator at CB Richard Ellis, a real estate consultancy.
Multinationals with local operations in Warsaw are the most likely candidates for suburban offices.
"There are companies that will never build their own offices, such as foreign corporations that don't want to own real estate in any market (they operate in) for tax reasons," Zagórski said.
Real estate experts also said that the corporate move to non-central locations reflects a reversal in the trend during the early 1990s when a lack of office space forced businesses such as fast-moving consumer goods firms - which in other European cities are usually located in the suburbs - to move to the CBD.
"The increasing tendency to relocate outside the CBD is a natural process of market readjustment," Zagórski said, adding that the phenomenon was a sign that the Warsaw office market was maturing.
"These companies are returning to their natural locations," he said.
